Yeo Economic Chief Yoo Seung-min's Real Estate Pledge: "Supply 1 Million Private Houses in the Seoul Metropolitan Area as Quickly as Possible"

Seoul Floor Area Ratio Eased to 400%
Up to 200 Million KRW Low-Interest Loans per Person for Newlyweds, etc.
LH Reorganized into Housing Welfare Corporation
LTV Increased to 80%, DSR Reflects Future Income

Former lawmaker Yoo Seung-min. / Photo by Dongju Yoon doso7@

[Asia Economy Reporter Naju-seok] Former lawmaker and People Power Party presidential candidate Yoo Seung-min announced a real estate policy on the 14th that includes supplying 1 million private housing units in the metropolitan area and easing housing finance regulations for homeless people in their 20s and 30s. The plan also includes low-interest loans of up to 200 million KRW per person for newlyweds and others when purchasing homes.

On the same day, Yoo unveiled the "Yoo Seung-min's Hope Ladder Housing Pledge," which focuses on revitalizing private housing supply and other housing supply activation measures. He stated, "The reason Seoul housing prices stabilized for over 10 years during the Kim Young-sam and Kim Dae-jung administrations was thanks to the first phase of new town supply under the Roh Tae-woo government," adding, "Supply measures that are one step ahead of the market are the most important." To this end, he promised, "I will supply 1 million private housing units in the metropolitan area as quickly as possible."

To achieve this, he said, "Rather than building new towns, I will significantly ease floor area ratio regulations in Seoul and surrounding cities to promote redevelopment and reconstruction of existing urban areas," adding, "In Seoul, the floor area ratio will be eased up to 400%." He also announced plans to promote reconstruction and redevelopment through high-density housing supply promotion and easing safety inspection standards. Additionally, he introduced a plan to "flexibly convert 'green belts that lack greenery and thus do not serve as green spaces' into residential land."

He also presented measures from a residential welfare perspective. He plans to reorganize the Korea Land and Housing Corporation (LH) into a Residential Welfare Corporation and convert metropolitan local governments' housing-related public enterprises into residential welfare agencies. Furthermore, he promised to build 500,000 public rental housing units in the metropolitan area.

The pledge also includes easing housing finance regulations to help homeless people secure housing. The loan-to-value ratio (LTV) regulation for home mortgage loans for homeless people will be significantly eased up to 80%, with further relaxation for first-time homebuyers and newlyweds. Additionally, total debt service ratio (DTI/DSR) regulations will be eased by considering future income, among other factors.

Low-interest loans of up to 200 million KRW per person will be supported for first-time homebuyers or newlyweds. For couples, this amount increases to 400 million KRW, and for each child, an additional 50 million KRW is added. The government will cover the difference between market interest rates and the loan interest rates.

To stabilize the jeonse and monthly rent market, the plan includes abolishing the three lease laws and restoring the private housing rental registration system to revitalize the private rental market. It also contains measures to encourage housing rental business operators and strengthen public support for affordable long-term rentals.

Measures to reduce the tax burden on homeowners were also presented. He promised to lower acquisition tax to 1% regardless of price, maintain heavy taxation on owners of two or more homes but adjust it to a reasonable level, reduce the highest capital gains tax rate to 40%, and maintain deductions for long-term holders. Regarding official property prices, he stated, "We will control the pace of official price increases so that they do not become an excessive burden on the public," and "We will establish a Real Estate Official Price Verification Institute to correct official prices."

Regarding this real estate pledge, Yoo said, "The Moon Jae-in administration doubled apartment prices and caused severe pain to the middle class and ordinary people through soaring jeonse and monthly rents and a tax bomb. This alone is a sufficient reason to change the regime," adding, "In the early stages of the administration, we will 'greatly increase supply and significantly reduce real estate taxes' to stabilize housing prices and rents and reduce the tax burden on the people."

This content was produced with the assistance of AI translation services.